Peer-to-Peer Rental Markets in the Sharing Economy

Samuel P. Fraiberger () and Arun Sundararajan ()
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Samuel P. Fraiberger: Northeastern University, Network Science Institute, 177 Huntington Avenue, Boston MA 02115
Arun Sundararajan: Leonard N. Stern School of Business, New York University, 44 West 4th Street, New York, NY 10012

No 15-19, Working Papers from NET Institute

Abstract: To investigate whether peer-to-peer rental markets for durable goods are welfare-improving, we develop a new dynamic model of such markets in which users with heterogeneous utilization rates may also trade in secondary markets. We calibrate our model with US automobile industry data and transaction-level data from Getaround, a large peer-to-peer car rental marketplace. Counterfactual analyses illustrate significant shifts away from asset ownership as marketplace access grows. Used-good prices fall and replacement rates rise, while gains in consumer surplus range from 0.8% to 6.6%. The changes in consumption mix and the surplus increases are significantly more pronounced for below-median income consumers.

Keywords: sharing economy; electronic markets; social media; durable goods; collaborative economy; on-demand; collaborative consumption; crowdsourcing; crowdfunding; p2p; Internet; ecommerce; Airbnb; Uber; Lyft; Lending Club; Blablacar; WeWork; Instacart; Ola (search for similar items in EconPapers)
JEL-codes: D4 L1 L81 (search for similar items in EconPapers)
Pages: 44 pages
Date: 2015-10
New Economics Papers: this item is included in nep-com and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (54)

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